Rebuilding the Syrian Economy After Assad

Looking Ahead to What Must Be Done

SOURCE: AP/Rodrigo Abd

Villagers chant antigovernment slogans during a demonstration organized after a man killed during clashes between the Free Syrian Army and Syrian leader Bashar al-Assad's forces in Sarmin, Syria, Tuesday, February 28, 2012.

Syrian leader Bashar al-Assad’s murderous regime could collapse tomorrow or continue with its violent suppression of its people for months or years to come. Either way, the country’s economy is in shambles and will only get worse as Syrians bravely take to the streets to claim their political rights and as the international community imposes more economic sanctions. The European Union, members of the Arab League, and the United States have all imposed sanctions, with President Barack Obama adding his voice to the growing consensus that the Syrian leader must go.

Predicting how quickly pressure on Assad at home and abroad might result in his downfall is a fool’s errand, but it is not too early to start thinking about what might help Syria’s economy recover after Assad. To be sure, conditions on the ground at that time will determine exactly what kind of economic relief is most immediately appropriate. But the international community today can begin to consider the kind of technical assistance that will be needed—in the form of skilled professionals paid for by donor countries to help rebuild Syria’s economy with a focus on “just jobs,” complete with appropriate pay and protections.

After all, the international community is still grappling with how to support the economies of the other Arab Spring countries despite the urgent need for assistance. More than a year after the fall of Egyptian strongman Hosni Mubarak, the United States and Egypt are still in the drafting stage of an economic Action Plan, and the European Bank for Reconstruction and Development has yet to finalize any projects for Egypt or Tunisia.

This is why making plans for any assistance to Syria in the future would be timely today. Make no mistake, simply getting back to how things were before the protests will be incredibly challenging. But just returning to the way things were will not be good enough. Syria’s economic growth averaged 5 percent per year in the five years leading up to the protests, but it did not benefit large segments of society. The official, wildly optimistic, unemployment rate was 8 percent. The true figure was likely closer to 20 percent. Given Damascus’s chronic underestimations, youth unemployment and female unemployment were both likely substantially higher than the official rates of around 20 percent.

When considering how to help Syria, the international community can draw broad lessons from past rebuilding efforts. Former World Bank economist Paul Collier in his 2007 book, The Bottom Billion: Why the Poorest Countries are Failing and What Can Be Done About It, crunched the numbers on post-civil-war countries and found that most initially lack the skills to manage the large flows of aid that typically rush in immediately after the end of the conflict. Technical assistance, in contrast, was particularly valuable in the early years after conflicts ended and then became progressively less useful. The best path was to start with technical assistance and subsequently increase aid.

The story is similar with countries recovering from economic sanctions. Despite their vast differences, both Malawi and South Africa, two examples of countries that established inclusive democracies after facing sanctions, would have benefited from technical assistance. The new governments both suffered from broken promises, which Patrick Bond, now at the Centre for Civil Society at the University of KwaZulu-Natal in South Africa, detailed in his 2003 book, Against Global Apartheid: South Africa Meets the World Bank, IMF, and International Finance. Indeed, the international community lacked trained officials in both post-conflict and post-sanction countries. Those skilled and dedicated people are the important missing resource.

Through the Deauville Partnership, which brings together interested donor countries and economic development institutions, the international community has already taken the important first step of establishing a platform through which it can coordinate its support for Syria and other Arab Spring countries. The United States now chairs the partnership, and it should make sure the international community is ready with credible commitments of technical assistance. The most effective support will focus on building the technical capacity of the Syrian government, enticing the plentiful number of talented ex-patriots to return home, and helping craft an economic plan that leads to broad and equitable growth.

Over time, traditional aid devoted to specific projects in Syria could be useful. This kind of aid could help Syria increase its export competitiveness by improving the quality of its ports. It could also support the development of small businesses, which would have the dual advantage of further diversifying the economy away from the oil sector and eroding the power of the few large firms that have dominated the economy under Assad. Both traditional aid projects and technical assistance would help create the sort of good jobs that go along with greater economic mobility and sustainable growth.

Thousands of Syrians have died and even more suffered economic hardship fighting for a better future. One protester, Sameh Nawar, when asked why he has risked so much to oppose Assad, said, “It’s tough but I cannot hope for a decent living until this revolution brings me and my children the opportunity that repression robbed [from] me.” The international community needs to be ready to help so that Sameh and his fellow Syrians’ struggle is not in vain.

Jordan Bernhardt is a Special Assistant with the Economy team at the Center for American Progress, working on the Just Jobs project at the Center.